Bloomberg Digs on Secret Money

A report on unreported election spending

A tip of the hat to Bloomberg for a recent quadruple-bylined story on the growing role of outside spending—much of it anonymous dollars—in federal elections. Noting that the “restocking of the outside-money war chests for the presidential election has already begun,” (not to mention the opening of new war chests) Bloomberg looks back at how some such money flowed in 2010, including these “secretive groups’ strategy, their willingness to cooperate with one another on tactics and their spending on close races in the final days of the 2010 campaigns.”

Using broadcasting records from TV stations and estimates from the Campaign Media Analysis Group, which tracks political advertising, Bloomberg reports that five “Republican-leaning groups” (including one called—gee whiz!—the Commission on Hope, Growth and Opportunity) “spent at least $4.05 million attacking candidates in the run-up to the November election,” spending which can not be found in the Federal Election Commission’s public database and of which an FEC spokesperson told Bloomberg the agency has no record.

Here’s the bit where Bloomberg explains that it is not picking on Republicans:

Examples of how this money worked in 2010 were found largely on the Republican side. That’s because conservative outside groups, who overwhelmingly spend on behalf of Republicans, outspent the liberal ones that favor Democrats by about two to one — and by seven to one when the money came from secret donors, [Center for Responsive Politics] data show.

About that unreported spending from the five “Republican-leaning” groups:

Federal law requires FEC disclosure of money spent on ads mentioning or depicting a candidate in the 60 days before a general election. The five groups whose spending wasn’t reported either declined to comment, were unreachable, or said they deemed the spending not reportable under the law.

There are outside groups that report their political spending and their donors (super PACs, for example, like American Crossroads or the newly-formed Priorities USA Action). There are outside groups that report their spending but not their donors (including 501(c)(4)s like Crossroads GPS or Priorities USA).
And then there are groups like the Commission on Hope, Growth and Opportunity that, per Bloomberg, “represents an even more secretive type that has taken itself off the radar of federal regulators entirely—by reporting neither spending nor donors to the FEC.”

Bloomberg notes that the FEC is not likely to go after these groups (and extra points for Bloomberg for including what election law professor Richard Hasen told me was a “tremendously under-covered” aspect of all of this) since “split votes between Republican and Democratic commissioners have stymied enforcement in case after case for almost three years.”

So, what’s the upshot? Per Bloomberg:

As a result, voters may find themselves choosing the next U.S. president knowing less about those trying to shape their views of the candidates than they have since secret money helped finance the Watergate burglary and re-elect President Richard Nixon in 1972. Watergate led to his resignation and ushered in the law that created the FEC. Investigators found more than $20 million had been given behind the scenes to Nixon’s campaign.

In the 2010 election, donors tested how secret spending through outside groups works, and used it on a small scale, according to Linda Fowler, a government professor at Dartmouth College in Hanover, New Hampshire. “There will be more next time,” she said.

More money. Less information.

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